GAO: Defunct Biden student debt forgiveness scheme did not verify borrower eligibility

Countless Americans were outraged by President Joe Biden's plan to use taxpayer funds to erase significant amounts of student debt willingly incurred, but it now appears that the administration was very close to doling out those millions without even bothering to verify recipients' eligibility for the program, as the Washington Times reports.

The shocking details were revealed in a report from the Government Accountability Office (GAO) that was released to the public on Thursday.

Program contours exposed

According to the GAO report, the Biden Department of Education was poised to approve upwards of 2 million applications for student debt relief under the program which was ultimately invalidated by the U.S. Supreme Court.

However, the watchdog agency noted, the approvals were going to be based merely on self-reported income data received from applicants, leaving the entire scenario ripe for fraud of the sort that plagued pandemic relief programs.

The GAO auditors who led the review of the situation wrote, “Education sought to expedite approvals for millions of borrowers by approving them automatically but relied solely on self-reported data for more than 2 million of these borrowers.”

“By not addressing the risks of self-reported data, Education left the door open to the possibility of some ineligible borrowers receiving relief based on fraudulent data,” the auditors continued.

As the Times noted, such a program is frequently referred to as a “pay-and-chase” plan, one in which a government agency disperses large amounts of money and only attempts to reclaim sums fraudulently received well after the fact.

Education Department explains

The Education Department, for its part, contended that it simply attempted to build a program that would offer relief while adding the lowest burden onto the borrowers themselves and argued that the fraud risk was low because actual payments were not going out the door, but rather loan balances were being modified from within.

As such, the agency said, a fraud risk of under 1% was possible, even in “the most unlikely worst-case scenario,” though the GAO auditors maintained that such a degree of abuse was still too much, given the sizable scale of the initiative.

Also unconvinced as to the supposedly harmless nature of the revelations were Republican lawmakers on Capitol Hill, including Rep. Virginia Foxx of North Carolina.

“Rather than intervening to mitigate instances of fraud from students who applied for loan forgiveness, the department leaned back in its chair, kicked up its feet and took a nap," she said.

Sen. Bill Cassidy (R-LA) of the Senate Health, Education, Labor and Pensions Committee expressed similar disgust, saying, “It is unconscionable that the Biden administration was willing to shift hundreds of billions of dollars of student debt onto taxpayers with no accountability. Americans who did not go to college or paid off their loans should not be stuck paying the bill for those who went to college to make more money after graduation.”